Advertising

Chapter 19
Advertising and It’s Purpose

 Advertising is nonpersonal promotion

which promotes ideas, goods or services by
using a variety of media.
 The average city dweller is exposed to more
than 3,000 advertising messages everyday
 Advertisers control the message, where it
will be seen or heard, and how often it will be
repeated
Advertising and It’s Purpose

 Marketers can use advertising to introduce a

new business or change a company image
 Advertising can also promote a new product
or an existing one, encourage the use of a
particular service, or encourage business-
to-business transactions
 Two main types of advertising:
 Promotional Advertising
 Institutional Advertising
Promotional Advertising Definition

 Advertising designed is to increase sales

 Targets are consumers or B2B customers
 Encourages potential customers to ask for
info, call for appointment, participate on
the internet, or enter a retail store.
 Leads / Prospecting
Institutional Advertising Definition

 Designed to create a favorable image for a

company and foster goodwill in the
marketplace
 Connecting the businesses name to a
worthy cause helps a company make a
favorable impression
 Does not directly increase sales
Mass Advertising Versus Targeted
Advertising
 Mass ads enables
companies to reach
large numbers of
people
 Targeted ads target
messages to select
audiences
 Advertising
demonstrates
features and benefits
Types of Media
Medias - the agencies, means, or instruments used to
convey advertising messages to the public.

 4 General categories
 The advertising
message and the target
audience determine the
type of media that is
used
Newspaper Television Opt-in e- Giveaways Promoted
mail Tweets
1. Print Media

a. Newspaper advertising
b. Magazine advertising
c. Direct-mail advertising
d. Directory advertising
e. Outdoor advertising
f. Transit advertising
a. Newspaper Advertising
 Daily and Weekly
Newspapers – local
papers
 Shoppers and
Alternative Newspapers
– delivered to homes
 National Newspapers –
USA Today, Wall Street
Journal
b. Magazine Advertising
 Distributed locally,
regionally or nationally
 Published weekly,
monthly and quarterly
 Consumer or B2B
 B2B are also known as
trade magazines
c. Direct Mail
 Highly focused form of advertising
 Printed direct mail
 Electronic direct mail
 Newsletters, catalogs, coupons, samples,
circulars and invitations to sales
 Carefully selecting the target
d. Directory Advertising
 A directory that accepts
advertising
 Relatively inexpensive
and target all
demographic groups
 Kept of a year
 White Pages
 Yellow Pages
e. Outdoor Advertising
 Non-standardize
outdoor signs used at
the place of business
 Standardized outdoor
signs are purchased
from advertising
companies
 Highly visible and
relatively inexpensive
 Available 24 / 7
f. Transit Advertising
 Found on public
transportation – trains,
taxis buses, public
benches, bus stop
shelters, kiosks,
newsstands, trashcans,
subways, railroad, bus
and airline terminals
 Reaches wide and
captive audiences
2. Broadcast Media
 Encompass radio and
television
 Over a lifetime of 66
years – a person will
watch nearly ten years
of TV and 6 years
listening to the radio
 Network and cable
a. Television Advertising

 The ultimate advertising medium for many

businesses
 Combine creative elements – sight , sound,
action and color
 30 to 60 spots
 Infomercials promote products
 Highest production costs
 Small companies cannot afford
b. Radio Advertising
 Radio stations reach 96% of people age 12
and over
 Radio is a mobile medium
 Messages can be updated daily or hourly
 Carefully target market based on type of
radio station
 Presented in 10, 20, 30 or 60 second spots
 Background music, jingles, slogans add
drama
3. Internet Advertising
 Is a form of advertising
that uses either email
or the World Wide
Web (www)
 Small part of overall
advertising but growing
 Opt-in e-mail ads,
banner ads, pop-up
ads, search engine
ads, and rich-media
video ads
4. Specialty Media
 Sometimes called
giveaways or
advertising
specialties
 Relatively
inexpensive with
advertiser’s name or
logo
 Located in high
visibility area
5. Other Advertising Media
 Ad supported TV screens at airports, gas
stations, health clubs and subways
 Digital billboards at sports arenas
 On-screen movie theater ads
 Messages on diaper-changing stations,
trash cans, bathroom stalls elevators, hot
air balloons.
 Ceilings and floor graphics
 Electronic shelf ads
 Supermarket-cart displays
6. New Media
 Interactive and Internet-driven
 Uses electronic media devices such as
Wed-enabled small screen iPods, cell
phones, laptops, and video games to reach
increasing mobile populations
 Advertisers go to those places to find
their target market customers – blogs,
vlogs, video and audio newscasts, RSS
news feeds and social networking
 MEDIA PLANNING AND
SELECTION
 The process of selecting the appropriate
advertising media and deciding the time or
space in which the ads should appear to
accomplish the marketing objectives
 3 basic questions
1) Can the medium present the product and the
appropriate business image;
2) Can the desired customers be targeted with
the medium;
3) Will the medium get the desired response
rate?
Media Rates

Section 17.2
A. MEDIA MEASUREMENT

 Audience – number of homes or people

exposed to an ad
 Impression – a single exposure to an
advertising message
 Frequency – the number of times an
audience sees or hears an advertisement
 Cost per thousand (CPM) The media cost of
exposing 1,000 readers or viewers to an
advertising impression – comparison tool
B. MEDIA RATES

 Use a set format defined in terms of time or

space
 Based on geographic location
 Standard Rate and Data Service – look up
rates
 Audit Bureau of Circulations (ABC) – verify
circulation rates
1. NEWSPAPER RATES

 Two types of advertising – classified ad or

display ad
 Classified ads pay by the word or line
 Display ads – larger than classified ads and
cost is based upon the amount of space used
and the ad’s position in the newspaper
 Quote rates by the column inch
 FACTORS THAT AFFECT
NEWSPAPER RATES
 Day of week ad runs  Guaranteed or
 Where the ad appears preferred locations
in the paper  Color use in ad
 Run-of-paper rates  Frequency of the ad
allows the newspaper  Open rates versus
to place the ad where contract rates
ever they feel it would
fit
 COMPARING RATES

 Use CPM to compare ad rates

 Cost of the ad x 1,000/Ciculation = CPM
 $500 x 1,000/500,000 = $1 per 1,000 readers
 $600 x 1,000/300,000 = $2 per 1,000 readers
 Does ad reach target market?
2. MAGAZINE RATES
 Based on circulation, the  Cheapest ad is black &
type of readership and white. Color is more
production techniques expensive
 Bleed – half or full page ads  Premium position refers to
are printed to the very edge ad placement
of the page, leaving no  Rate discounts – based on
white border – charge 15% frequency or commission
– 20% more (% of sales given by the
 You use the CPM to magazine to the ad agency
compare costs for placing the ad for
advertiser
3. ONLINE RATES
 Based upon the type of
format the customer desires.
Banner ads
Rich-media enhanced
banner ads
Button ads
Interstitial ads
 CPM rate based on number
of viewers
 Rates vary based on the
volume of monthly page
views
4. RADIO RATES
Types of Radio Advertising
1. Network radio advertising
2. National spot radio ad
3. Local radio advertising

Spot radio refers to geographical

area where an ad runs
Spot commercial are ad
messages of one minute or
less on network or spot radio
Drive time and run-of schedule
(ROS) allows a radio station to
decide when to run the ad.
5. TELEVISION RATES
 Rates vary with the
time of day. Prime time
(7:00 p.m.-10:00 p.m.)
most expensive
 Advertisers try to play
their messages during
the time slots that
enable them to reach
the most customers
D. PROMOTIONAL BUDGET
FOUR METHODS
Promotional Budget considers not only the cost for developing
and placing or airing advertising but also the cost of staffing the
department or campaign.

4 Common promotional budgeting methods are:

1. Percentage of sales method – budget based on a percentage of
past or anticipated sales
2. All you can afford method – first pay all expenses then apply
remainder of funds to promotional activities
3. Following the competition method – advertiser matches its
competitor’s promotional expenditures
4. Objective and task method – company determines goals,
identify steps to meet goals and determines cost for promotional
activities to meet goals